Customer Reviews

THAI paints a brighter picture

AN
investment group from Finland believes THAI will get back on-track, but
it will require restructuring and support from the Finance Ministry;
its major shareholder.

Finlandâ€'s PYN Fund Management founder and
group leader, Petri Deryng, explained his confidence in Thai Airways
International, at the close of a visit to the national airline, last
week.

He said the fact that the Thai government was the major
shareholder would help the airline to weather the storm and rebuilt
confidence.

The loss caused by the airport shutdown, last year, was unavoidable, he said, but the company would overcome its difficulties.

Another
strong factor was Thailandâ€'s potential as a tourist destination and the
airlineâ€'s role in drawing tourists to the country. About half of all
genuine tourists visiting Thailand travel on THAI flights.

â€œOf
course, right now a Bt70 billion company appears to be valued at Bt12
billion.Â Ironically, this makes it a very attractive investment
because of its value and an ability to improve,â€ he said.

THAI vice president, investor relations department, Raj Tanta-Nanta, admitted that there was a short term liquidity problem.

â€œWe
braced for a very bad outcome after the closure of the airports. But
figures for Q1 and the outlook for Q2 improved. We may be able to move
the full recovery time-frame forward by four months.â€

The
airlineâ€'s average cabin factor is in the range of 60 to mid-70%.
Intercontinental routes have improved from 63.4% in December to 75% in
January. Advance bookings show a cabin factor of 75% is achievable.

Regional
routes, Middle East and Indian- subcontinent routes, are improving and
the airline has increased flights to some cities in South Asia and the
Middle East.

Chinese and Korean traffic appears to be making a comeback, too, but demand in the Japanese market remains soft.

â€œIâ€'m
not trying to convince you that we will make profit in 2009. What we
are looking at is, either a breakeven year, or one slightly below.
Hopefully, by 2010 we will get back to normal and be back in black,â€
said Mr Raj.

Moving all operations to Suvarnabhumi Airport, will
save the airline Bt700 million a year, offer better connectivity and
strengthen the regional hub, he added.

As for its core product, Mr Raj insisted aircraft due for delivery will join the fleet without any delays.

â€œTHAI
needs to compete with other airlines. With better equipment we can
increase yield reduce maintenance costs and burn less fuel,â€ he said.